Actually during Prophet's time, there were only individual Jewish money lenders who gave short term loans to poor people mainly for consumption purpose and they used to charge heavy interest. This was rightly prohibited by Allah. In India such small loans are still given by Hindu Marwaris on interest.
But the commercial banks are totally different and none give small loans for consumption purpose only. The banks are not individually owned like money lenders. They are owned by thousands of share holders and their shares are available in the Stock Exchange. Yearly meetings are held to approve P/L Account, Balance Sheet etc. and to elect Directors also. The profit earned by the banks do not go to any individual but to all shareholders. All banks are controlled by the State Bank. Their functions include accepting deposits, maintaining individual and commercial accounts, advancing loans for purchase of houses, shops etc., to maintain and run factories, mills, business etc., transfer of money, foreign exchange dealings, letter of credit etc.
Hence to say banks are money lenders only is a false notion spread by our Mulla community to fool us. The banks rightly charge 'commission' on loans and other works. If the banks are really 'Haraam', then there will be no banks in Arabia particularly Saudi Arabia where they are functioning smoothly and well.
The tragedy is that Islam has been hijacked by our Mulla community to divide and rule us. What they say is accepted as Islam. Some of the big Mullas secretly favor banks also after receiving loans/gifts. Hence since we lack Quranic knowledge, we depend on Mullas for Guidance instead of Allah and HIS Quran. Our over-research on a complete Deen is also a stumbling block to achieve progress in all fields.
In Pakistan every Mulla is more or less exploiting Islam t deviate us. Writing of heavy books and literature on Islam and advising each other to follow Islam has become a good hobby. That is why we are more divided and deviated in religious matters and rituals so much so our Masajid are also divided. Not so in Saudi Arabia where private publications of Islamic literature/books are banned in the interest of Islam and unity. This is required in Pakistan now. Thanks.
Moulvi Saeed Siddique: